Hong Yuan Holding Group (HGYN)

[badslinke]

Great write up and reasonable analysis based on available facts. But I see one major problem.

A lot of the folks in your camp, Sky, with all due respect to them, are championing a buy signal right now expecting a major run should CERP announce new financing after getting rid of the vultures.

However, if you guys also believe Horizon will be paid by means of R/S, the inevitable result will be further dilution as they dump more shares into the market to pay off the creditor. Effectively, that means anyone buying now or post R/S will be paying off CERP's debts for them.

Simply put, according to your own words, any shares bought now will be split, and then diluted to pay the Horizon debt.

So why on earth are you buying now? Are you expecting some incredible run based on financing news, then going to sell just before the R/S takes place? That would be the only possible strategy that makes sense, and I can see why you might imagine there will be a huge pop given what happened last year around this time, but it strikes me as incredibly risky. What happens if the R/S hits before new financing is announced, and you get eaten alive by the R/S and dilution before this incredible pop? Or even if Horizon wins in court and CERP gets liquidated?

I'd much rather STFA (stay away), instead of buy, hold or even sell right now. Let the dust settle, and see who is left standing.